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Understanding South Carolina Home Prices

12 Monday Jun 2023

Posted by in Columbia housing market

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Understanding South Carolina Home Prices: Comparing Year-Over-Year and Month-Over-Month Trends

The media coverage surrounding South Carolina home prices can often be bewildering. The confusion arises from the various data sources utilized and the specific aspects highlighted. When analyzing home prices, two distinct methods are employed to compare prices across different time periods: year-over-year (Y-O-Y) and month-over-month (M-O-M). Let’s delve into each of these methods to gain a better understanding.

Year-over-Year (Y-O-Y) Comparison:
The year-over-year comparison is a valuable tool for assessing long-term trends in South Carolina home prices. This method compares the average home prices for a particular month or quarter with the corresponding period from the previous year. By examining year-over-year changes, we can discern whether home prices have increased or decreased over the course of twelve months. This approach provides insights into the overall health and stability of the housing market in South Carolina.

Month-over-Month (M-O-M) Comparison:
On the other hand, the month-over-month comparison focuses on short-term fluctuations in South Carolina home prices. This method scrutinizes the average home prices from one month to the next, aiming to identify any noteworthy changes within a smaller time frame. Month-over-month comparisons are particularly useful for pinpointing rapid shifts or seasonal patterns in the housing market. This data can be valuable for buyers and sellers looking to make informed decisions in a dynamic real estate landscape.

Both year-over-year and month-over-month comparisons contribute unique perspectives to our understanding of South Carolina home prices. While year-over-year analysis sheds light on long-term trends, month-over-month analysis captures more immediate fluctuations. By considering both approaches, we can acquire a comprehensive picture of the state’s housing market and make informed judgments regarding home prices.

It is important to note that interpreting media coverage on home prices requires a discerning eye. Being aware of the underlying methodology and the specific time periods being compared will enable us to navigate through the often complex landscape of South Carolina’s housing market with greater clarity.

#SouthCarolinaHousing, #HomePrices, #RealEstateAnalysis, #RMFRealty, #SCRealtor, #Rozalynfranklinrealtor,

Bottom Line

If you have questions about what’s happening with home prices, or if you’re ready to buy before prices climb higher, let’s connect.

3 Ways You Can Use Your Home Equity

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Posted by in Buying Myths, Rent-vs-Buying, SC Home Sellers, Selling your Columbia Home, South Carolina Living

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3 Ways You Can Use Your Home Equity | MyKCM

3 Ways You Can Use Your Home Equity

If you’re a homeowner, odds are your equity has grown significantly over the last few years as home prices skyrocketed and you made your monthly mortgage payments. Home equity builds over time and can help you achieve certain goals. According to the latest Equity Insights Report from CoreLogic, the average borrower with a home loan has almost $300,000 in equity right now.

As you weigh your options, especially in the face of inflation and talk of a recession, it’s important to understand your assets and how you can leverage them. A real estate professional is the best resource to help you understand how much home equity you have and advise you on some of the ways you can use it.  Here are a few examples.

1. Buy a Home That Fits Your Needs

If you no longer have the space you need, it might be time to move into a larger home. Or it’s possible you have too much space and need something smaller. No matter the situation, consider using your equity to power a move into a home that fits your changing lifestyle. 

If you want to upgrade your house, you can put your equity toward a down payment on the home of your dreams. And if you’re planning to downsize, you may be surprised that your equity may cover some, if not all, of the cost of your next home. A real estate advisor can help you figure out how much equity you have and how you can use it toward the purchase of your next home.

2. Reinvest in Your Current House

According to a recent survey from Point, 39% of homeowners would invest in home improvement projects if they chose to access their equity. This is a great option if you want to change some things about your living space but you aren’t ready to make a move just yet.

Home improvement projects allow you to customize your home to suit your needs and sense of style. Just remember to think ahead with any updates you make, as some renovations add more value to your home and are more likely to appeal to future buyers than others. For example, a report from the National Association of Realtors (NAR) shows refinishing or replacing wood flooring has a high cost recovery. Lean on a local professional for the best advice on which projects to invest in to get the greatest return on your investment when you sell.

3. Pursue Your Personal Goals

In addition to making a move or updating your house, home equity can also help you achieve the life goals you’ve dreamed of. That could mean investing in a new business venture, retiring or downsizing, or funding an education. While you shouldn’t use your equity for unnecessary spending, leveraging it to start a business or putting it toward education costs can help you achieve other lifelong goals.

Bottom Line

Your equity can be a game changer. If you’re unsure how much equity you have in your home, let’s connect so you can start planning your next move.

Home Prices: What Happened in 2020? What Will Happen This Year?

02 Tuesday Mar 2021

Posted by in Buying Myths, Columbia tell me what you think?, SC Home Sellers, Selling your Columbia Home, South Carolina Living

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Home Prices: What Happened in 2020? What Will Happen This Year? | MyKCM

The real estate market was on fire during the second half of 2020. Buyer demand was way up, and the supply of homes available for sale hit record lows. The price of anything is determined by the supply and demand ratio, so home prices skyrocketed last year. Dr. Lynn Fisher, Deputy Director of the Federal Housing Finance Agency (FHFA) Division of Research and Statistics, explains:

“House prices nationwide recorded the largest annual and quarterly increase in the history of the FHFA Home Price Index. Low mortgage rates, pent up demand from homebuyers, and a limited housing supply propelled every region of the country to experience faster growth in 2020 compared to a year ago despite the pandemic.”

Here are the year-end home price appreciation numbers from the FHFA and two other prominent pricing indexes:

The past year was truly a remarkable time for homeowners as prices appreciated substantially. Lawrence Yun, Senior Economist at the National Association of Realtors (NAR), reveals:

“A typical homeowner in 2020, just by being a homeowner, would have accumulated around $24,000 in housing wealth.”

What will happen with home prices this year?

Many experts believe buyer demand will soften somewhat as mortgage rates are poised to bump up slightly. Some also believe the inventory challenge will ease as more listings come to market this year.

Home Prices: What Happened in 2020? What Will Happen This Year? | MyKCM

Based on this, most forecasters anticipate we’ll see strong appreciation in 2021 – but not as strong as last year. Here are seven prominent groups and their projections:

Bottom Line

Home price appreciation will be strong this year, but it won’t reach the historic levels of 2020. Let’s connect if you’d like to find out what your house is currently worth in our local market.

Benefits of a 20% Down Payment?

01 Monday Mar 2021

Posted by in Buying Myths, Home buying, Rent-vs-Buying

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Benefits of a 20% Down Payment?

What Are the Benefits of a 20% Down Payment? | MyKCM

If you’re thinking of buying a home this year, you may be wondering how much money you need to come up with for your down payment. Many people may think it’s 20% of the loan to secure a mortgage. While there are plenty of lower down payment options available for qualified buyers who don’t want to put 20% down, it’s important to understand how a larger down payment can have great benefits too.

The truth is, there are many programs available that allow you to put down as little as 3.5%, which can be a huge benefit to those who want to purchase a home sooner rather than later. Those who have served our country may also qualify for a Veterans Affairs Home Loan (VA) and may not need a down payment. These programs have really cut down the savings time for many potential buyers, enabling them to start building family wealth sooner.

Here are four reasons why putting 20% down is a good plan if you can afford it.

1. Your interest rate may be lower.

A 20% down payment vs. a 3-5% down payment shows your lender you’re more financially stable and not a large credit risk. The more confident your lender is in your credit score and your ability to pay your loan, the lower the mortgage interest rate they’ll likely be willing to give you.

2. You’ll end up paying less for your home.

The larger your down payment, the smaller your loan amount will be for your mortgage. If you’re able to pay 20% of the cost of your new home at the start of the transaction, you’ll only pay interest on the remaining 80%. If you put down 5%, the additional 15% will be added to your loan and will accrue interest over time. This will end up costing you more over the lifetime of your home loan.

3. Your offer will stand out in a competitive market.

In a market where many buyers are competing for the same home, sellers like to see offers come in with 20% or larger down payments. The seller gains the same confidence as the lender in this scenario. You are seen as a stronger buyer with financing that’s more likely to be approved. Therefore, the deal will be more likely to go through.

4. You won’t have to pay Private Mortgage Insurance (PMI)

What is PMI? According to Freddie Mac:

“PMI is an insurance policy that protects the lender if you are unable to pay your mortgage. It’s a monthly fee, rolled into your mortgage payment, that is required for all conforming, conventional loans that have down payments less than 20%. Once you’ve built equity of 20% in your home, you can cancel your PMI and remove that expense from your mortgage payment.”

As mentioned earlier, when you put down less than 20% when buying a home, your lender will see your loan as having more risk. PMI helps them recover their investment in you if you’re unable to pay your loan. This insurance isn’t required if you’re able to put down 20% or more.

Many times, home sellers looking to move up to a larger or more expensive home are able to take the equity they earn from the sale of their house to put down 20% on their next home. With the equity homeowners have today, it creates a great opportunity to put those savings toward a 20% or greater down payment on a new home.

If you’re looking to buy your first home, you’ll want to consider the benefits of 20% down versus a smaller down payment option.

Bottom Line

If you’re thinking of buying a home and are already saving for your down payment, let’s connect to discuss what fits best with your long-term plans.

Real Estate Is a Driving Force in the Economy

04 Wednesday Nov 2020

Posted by in Home buying

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Real Estate Is a Driving Force in the Economy | MyKCM

As the economy recovers from this year’s health crisis, the housing market is playing a leading role in the turnaround. Real Estate Is a Driving Force in the Economy. It’s safe to say that what we call “home” is taking on a new meaning, causing many of us to consider buying or selling sooner rather than later. Housing, therefore, has thrived in an otherwise down year.

Today’s high buyer demand combined with low housing inventory means we’re seeing home prices appreciate at an above-average pace. This demand is being driven by those who want to take advantage of historically low mortgage rates. According to Freddie Mac:

“The record low mortgage rate environment is providing tangible support to the economy at a critical time, as housing continues to propel growth.”

Real Estate Is a Driving Force in the Economy | MyKCM

These factors are driving a positive impact on the economy as a whole. According to the National Association of Realtors (NAR), the real estate industry provided $3.7 billion dollars of economic impact to the country last year. To break it down, in 2019, the average newly constructed home contributed just over $88,000 per build to local economies. Across the country, real estate clearly makes a significant impact (See map below):In addition, last week, the Bureau of Economic Analysis announced the U.S. Gross Domestic Product increased at an annual rate of 33.1% in the 3rd quarter of this year, after decreasing by 31.4% in the second quarter. There’s no doubt the growing economy is being fueled in part by the soaring housing market. Experts forecast this housing growth to carry into 2021, continuing to make a big impact on the economy next year as well.

Bottom Line

The American Dream of homeownership has continued to thrive in the midst of this year’s economic downturn, and “home” has taken on a new meaning for many of us during this time.  Best of all, the housing market is making a significant impact as the economy recovers.

Will COVID-19 Have on Impact on My Home Values?

27 Monday Apr 2020

Posted by in Home buying, Home Ownership, Uncategorized

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What Impact Might COVID-19 Have on Home Values? | MyKCM

A big challenge facing the housing industry is determining what impact the current pandemic may have on home values. Some buyers are hoping for major price reductions because the health crisis is straining the economy.

The price of any item, however, is determined by supply and demand, which is how many items are available in relation to how many consumers want to buy that item.

Will COVID-19 Have on Impact on My Home Values?

In residential real estate, the measurement used to decipher that ratio is called months supply of inventory. A normal market would have 6-7 months of inventory. Anything over seven months would be considered a buyers’ market, with downward pressure on prices. Anything under six months would indicate a sellers’ market, which would put upward pressure on prices.

Going into March of this year, the supply stood at three months – a strong seller’s market. While buyer demand has decreased rather dramatically during the pandemic, the number of homes on the market has also decreased. The recently released Existing Home Sales Report from the National Association of Realtors (NAR) revealed we currently have 3.4 months of inventory. This means homes should maintain their value during the pandemic.

This information is consistent with the research completed by John Burns Real Estate Consulting, which recently reported:

“Historical analysis showed us that pandemics are usually V-shaped (sharp recessions that recover quickly enough to provide little damage to home prices).”

What are the experts saying?

Here’s a look at what some experts recently reported on the matter:

Ivy Zelman, President, Zelman & Associates

“Supported by our analysis of home price dynamics through cycles and other periods of economic and housing disruption, we expect home price appreciation to decelerate from current levels in 2020, though easily remain in positive territory year over year given the beneficial factors of record-low inventories & a historically-low interest rate environment.”

Freddie Mac

“The fiscal stimulus provided by the CARES Act will mute the impact that the economic shock has on house prices. Additionally, forbearance and foreclosure mitigation programs will limit the fire sale contagion effect on house prices. We forecast house prices to fall 0.5 percentage points over the next four quarters. Two forces prevent a collapse in house prices. First, as we indicated in our earlier research report, U.S. housing markets face a large supply deficit. Second, population growth and pent up household formations provide a tailwind to housing demand. Price growth accelerates back towards a long-run trend of between 2 and 3% per year.”

Mark Fleming, Chief Economist, First American

“The housing supply remains at historically low levels, so house price growth is likely to slow, but it’s unlikely to go negative.”

Bottom Line

Even though the economy has been placed on pause, it appears home prices will remain steady throughout the pandemic.

Recession? Yes. Housing Crash? No.

21 Tuesday Apr 2020

Posted by in Columbia tell me what you think?, Home buying, Home Ownership, Investing In SC Real Estate, Selling your Columbia Home, Uncategorized

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Recession? Yes. Housing Crash? No. | MyKCM

With over 90% of Americans now under a shelter-in-place order, many experts are warning that the American economy is heading toward a recession, if it’s not in one already. What does that mean to the residential real estate market?

Recession? Yes. Housing Crash? No.

What is a recession?

According to the National Bureau of Economic Research:

“A recession is a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales.”

COVID-19 hit the pause button on the American economy in the middle of March. Goldman Sachs, JP Morgan, and Morgan Stanley are all calling for a deep dive in the economy in the second quarter of this year. Though we may not yet be in a recession by the technical definition of the word today, most believe history will show we were in one from April to June.

Does that mean we’re headed for another housing crash?

Many fear a recession will mean a repeat of the housing crash that occurred during the Great Recession of 2006-2008. The past, however, shows us that most recessions do not adversely impact home values. Doug Brien, CEO of Mynd Property Management, explains:

“With the exception of two recessions, the Great Recession from 2007-2009, & the Gulf War recession from 1990-1991, no other recessions have impacted the U.S. housing market, according to Freddie Mac Home Price Index data collected from 1975 to 2018.”

CoreLogic, in a second study of the last five recessions, found the same. Here’s a graph of their findings:Recession? Yes. Housing Crash? No. | MyKCM

What are the experts saying this time?

This is what three economic leaders are saying about the housing connection to this recession:

Robert Dietz, Chief Economist with NAHB

“The housing sector enters this recession underbuilt rather than overbuilt…That means as the economy rebounds – which it will at some stage – housing is set to help lead the way out.”

Ali Wolf, Chief Economist with Meyers Research

“Last time housing led the recession…This time it’s poised to bring us out. This is the Great Recession for leisure, hospitality, trade and transportation in that this recession will feel as bad as the Great Recession did to housing.”

John Burns, founder of John Burns Consulting, also revealed that his firm’s research concluded that recessions caused by a pandemic usually do not significantly impact home values:

“Historical analysis showed us that pandemics are usually V-shaped (sharp recessions that recover quickly enough to provide little damage to home prices).”

Bottom Line

If we’re not in a recession yet, we’re about to be in one. This time, however, housing will be the sector that leads the economic recovery.

Today’s Homebuyers Want Lower Prices. Sellers Disagree.

16 Thursday Apr 2020

Posted by in Home Ownership, SC Home Sellers, Uncategorized

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Today’s Homebuyers Want Lower Prices. Sellers Disagree. | MyKCM

The uncertainty the world faces today due to the COVID-19 pandemic is causing so many things to change. The way we interact, the way we do business, even the way we buy and sell real estate is changing. This is a moment in time that’s even sparking some buyers to search for a better deal on a home. Sellers, however, aren’t offering a discount these days; they’re holding steady on price.

According to the most recent NAR Flash Survey (a survey of real estate agents from across the country), agents were asked the following two questions:

1. “Have any of your sellers recently reduced their price to attract buyers?”

Their answer: 72% said their sellers have not lowered prices to attract buyers during this health crisis. 

2. “Are home buyers expecting lower prices now?”

Their answer: 63% of agents said their buyers were looking for a price reduction of at least 5%.Today’s Homebuyers Want Lower Prices. Sellers Disagree. | MyKCM

What We Do Know  

In today’s market, with everything changing and ongoing questions around when the economy will bounce back, it’s interesting to note that some buyers see this time as an opportunity to win big in the housing market. On the other hand, sellers are much more confident that they will not need to reduce their prices in order to sell their homes. Clearly, there are two different perspectives at play.

Bottom Line

If you’re a buyer in today’s market, you might not see many sellers lowering their prices. If you’re a seller and don’t want to lower your price, you’re not alone. If you have questions on how to price your home, let’s connect today to discuss your real estate needs and next steps.

Recession? Yes. Housing Crash? No.

13 Monday Apr 2020

Posted by in Columbia tell me what you think?, Home buying, SC Home Sellers, Uncategorized

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Recession? Yes. Housing Crash? No. | MyKCM

With over 90% of Americans now under a shelter-in-place order, many experts are warning that the American economy is heading toward a recession, if it’s not in one already. What does that mean to the residential real estate market?

Recession? Yes. Housing Crash? No. What is a recession?

According to the National Bureau of Economic Research:

“A recession is a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales.”

COVID-19 hit the pause button on the American economy in the middle of March. Goldman Sachs, JP Morgan, and Morgan Stanley are all calling for a deep dive in the economy in the second quarter of this year. Though we may not yet be in a recession by the technical definition of the word today, most believe history will show we were in one from April to June.

Does that mean we’re headed for another housing crash?

Many fear a recession will mean a repeat of the housing crash that occurred during the Great Recession of 2006-2008. The past, however, shows us that most recessions do not adversely impact home values. Doug Brien, CEO of Mynd Property Management, explains:

“With the exception of two recessions, the Great Recession from 2007-2009, & the Gulf War recession from 1990-1991, no other recessions have impacted the U.S. housing market, according to Freddie Mac Home Price Index data collected from 1975 to 2018.”

CoreLogic, in a second study of the last five recessions, found the same. Here’s a graph of their findings:Recession? Yes. Housing Crash? No. | MyKCM

What are the experts saying this time?

This is what three economic leaders are saying about the housing connection to this recession:

Robert Dietz, Chief Economist with NAHB

“The housing sector enters this recession underbuilt rather than overbuilt…That means as the economy rebounds – which it will at some stage – housing is set to help lead the way out.”

Ali Wolf, Chief Economist with Meyers Research

“Last time housing led the recession…This time it’s poised to bring us out. This is the Great Recession for leisure, hospitality, trade and transportation in that this recession will feel as bad as the Great Recession did to housing.”

John Burns, founder of John Burns Consulting, also revealed that his firm’s research concluded that recessions caused by a pandemic usually do not significantly impact home values:

“Historical analysis showed us that pandemics are usually V-shaped (sharp recessions that recover quickly enough to provide little damage to home prices).”

Bottom Line

If we’re not in a recession yet, we’re about to be in one. This time, however, housing will be the sector that leads the economic recovery.

How to Find the Perfect Real Estate Agent

07 Tuesday Apr 2020

Posted by in Home buying, Home Ownership, ibuyers, Uncategorized

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How to Find the Perfect Real Estate Agent | MyKCM

There’s a ton of real estate information available in the news today and on the Internet. It can be extremely confusing, especially in times of uncertainty like we’re facing right now.

If you’re thinking of buying or selling this year, you need an agent who can help you:

How to Find the Perfect Real Estate Agent

  • Make sense of this rapidly evolving housing market
  • Navigate everything from virtual showings to new online marketing strategies
  • Price your home correctly at the beginning of the selling process
  • Determine what to offer on your dream home without paying too much or offending the seller

Dave Ramsey, a financial guru, advises:

“When getting help with money, whether it’s insurance, real estate or investments, you should always look for someone with the heart of a teacher, not the heart of a salesman.”

Hiring an agent who has a finger on the pulse of the current market will make your buying or selling experience so much easier.

So, how do you identify who truly understands what’s happening right now? How do you know who will take the time to simply and effectively explain what today’s market conditions mean to you and your family?

Check out the agent on social media. What are they posting on Instagram, Facebook, Twitter, and more? Are they using their social media platforms to share relevant, helpful information, or are they just posting memes and recipes? The best agents are committed to educating the consumer so they can feel confident when buying or selling a home.

Bottom Line

What agents are posting online will help you determine who meets the criteria Dave Ramsey suggested you look for: someone with the heart of a teacher. Let’s connect today, so you can work with a true trusted real estate professional.